金山软件(03888) - 2023 - 中期业绩

Financial Data Consolidated Financial Statements For the six months ended June 30, 2023, the Group's total revenue grew 13% to RMB 4.16 billion, operating profit increased 24% to RMB 1.14 billion, and profit attributable to owners of the parent turned profitable at RMB 250 million, with operating cash flow significantly up to RMB 2.31 billion Key Financial Data for the Six Months Ended June 30, 2023 | Metric | H1 2023 (RMB thousands) | H1 2022 (RMB thousands) | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Revenue | 4,163,797 | 3,687,167 | +12.9% | | Gross Profit | 3,457,239 | 2,969,986 | +16.4% | | Operating Profit | 1,136,015 | 918,179 | +23.7% | | Profit for the Period | 605,725 | 335,935 | +80.3% | | Profit/(Loss) Attributable to Owners of the Parent | 249,530 | (42,064) | Turned Profitable | | Basic EPS (RMB) | 0.18 | (0.03) | Turned Profitable | Summary of Balance Sheet as of June 30, 2023 | Metric | June 30, 2023 (RMB thousands) | Dec 31, 2022 (RMB thousands) | | :--- | :--- | :--- | | Total Assets | 34,890,675 | 31,887,955 | | Total Liabilities | 8,978,605 | 7,731,488 | | Total Equity | 25,912,070 | 24,156,467 | | Cash and Bank Balances | 21,684,511 | 18,201,410 | Summary of Cash Flows for the Six Months Ended June 30, 2023 | Metric | H1 2023 (RMB thousands) | H1 2022 (RMB thousands) | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 2,307,572 | 1,053,441 | | Net Cash Flow Used in Investing Activities | (1,482,629) | (456,902) | | Net Cash Flow from/(Used in) Financing Activities | 989,023 | (499,495) | Summary of Notes to Financial Statements The Group primarily operates in office software and services and entertainment software and others, with the former generating RMB 2.17 billion revenue and RMB 500 million segment profit, and the latter RMB 1.99 billion revenue and RMB 630 million segment profit; no interim dividend was declared - The Group primarily engages in two main businesses: (a) designing, researching, developing, and marketing WPS Office software products and services; and (b) researching and developing games, as well as providing PC and mobile game services[9][13] Segment Results for H1 2023 | Operating Segment | Revenue (RMB thousands) | Segment Profit (RMB thousands) | | :--- | :--- | :--- | | Office Software and Services | 2,172,497 | 502,912 | | Entertainment Software and Others | 1,991,300 | 630,418 | | Total | 4,163,797 | 1,133,330 | - The Board has resolved not to declare any interim dividend for the six months ended June 30, 2023[20] - The five-year convertible bonds with a principal amount of HKD 3.1 billion and an annual interest rate of 0.625%, issued in April 2020, had no conversions or redemptions during the reporting period[28] Operations Summary As of June 2023, monthly active devices for office software main products reached 584 million, a 2% year-on-year increase, with cumulative paying users growing 16% to 33.24 million Key Operating Data for Office Software | Metric | June 2023 | June 2022 | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Monthly Active Devices for Main Products (millions) | 584 | 570 | +2% | | Cumulative Paying Users (millions) | 33.24 | 28.56 | +16% | Management Discussion and Analysis Q2 2023 Performance Analysis In Q2 2023, the Group's total revenue grew 20% to RMB 2.19 billion, with office software and services revenue up 21% and online game revenue up 18% due to strong 'Jian Wang 3' performance; gross profit margin improved to 84%, and operating profit significantly increased by 61% Q2 2023 Revenue Performance | Business Segment | Revenue (RMB millions) | Y-o-Y Change | Q-o-Q Change | | :--- | :--- | :--- | :--- | | Office Software and Services | 1,120.8 | +21% | +7% | | Online Games and Others | 1,072.6 | +18% | +17% | | Total | 2,193.5 | +20% | +11% | - The year-on-year growth in office software business was primarily driven by the sustainable growth of domestic personal and institutional office subscription businesses[32] - The growth in online game business was mainly due to significant revenue increase from 'Jian Wang 3' through continuous updates and user experience optimization[32] - The gross profit margin for Q2 was 84%, an increase of four percentage points from the same period last year, primarily due to changes in revenue mix[33] - Operating profit before share-based compensation costs was RMB 767 million, a 59% year-on-year increase[35] H1 2023 Performance Analysis In H1 2023, the Group's total revenue grew 13% to RMB 4.16 billion, with office software and services revenue up 21% and online games and others revenue up 5%; gross profit margin improved to 83%, and profit attributable to owners of the parent turned profitable at RMB 250 million H1 2023 Revenue Performance | Business Segment | Revenue (RMB millions) | Y-o-Y Change | | :--- | :--- | :--- | | Office Software and Services | 2,172.5 | +21% | | Online Games and Others | 1,991.3 | +5% | | Total | 4,163.8 | +13% | - The gross profit margin for H1 was 83%, an increase of two percentage points from the same period last year[41] - Research and development costs increased by 6% year-on-year to RMB 1.33 billion, primarily due to increased employee-related expenses at Kingsoft Office Group[42] - Profit attributable to owners of the parent for H1 was RMB 249.5 million, compared to a loss of RMB 42.1 million in the same period last year[44] Liquidity and Financial Resources As of June 30, 2023, the Group maintained a strong cash position with RMB 21.68 billion in cash and bank balances and a healthy gearing ratio of 26%, while net cash from operating activities in H1 significantly increased to RMB 2.31 billion Financial Position Summary | Metric | June 30, 2023 | | :--- | :--- | | Cash and Bank Balances | RMB 21,684.5 millions | | Gearing Ratio | 26% | - Net cash generated from operating activities in H1 2023 was RMB 2.308 billion, a significant increase from RMB 1.053 billion in the same period last year[47] Business Review and Outlook The Group's core businesses developed steadily, with Kingsoft Office launching WPS AI and deepening digital transformation services, while flagship game 'Jian Wang 3' achieved record-high revenue and 'Snowbreak: Containment Zone' expanded globally; the Group plans to continue driving innovation - Kingsoft Office Group seized the opportunity of large language models, actively investing in R&D to launch WPS AI, an intelligent office assistant based on large language models, and commenced public beta testing overseas[49] - The office software business continues to advance government and enterprise cloud-integrated and collaborative office solutions, and incubate industry-agnostic solutions, centered on a 'multi-screen, cloud, content, AI, collaboration' strategy[49] - The flagship game 'Jian Wang 3' achieved record-high quarterly revenue, with both daily active users and revenue maintaining year-on-year growth[49][50] - The self-developed anime-style shooter 'Snowbreak: Containment Zone' was simultaneously released globally on PC and mobile platforms, expanding its user base and entering overseas markets[49][50] - Future plans include launching an upgraded performance version of 'Jian Wang 3' PC game in Q4, and the self-developed mobile game 'Jian Xia World: Origin', which has obtained a license, will also be launched in mainland China[50] Other Information Corporate Governance and Personnel As of June 30, 2023, the Group had 7,086 full-time employees with RMB 1.865 billion in H1 staff costs; the Audit Committee reviewed interim financial data, and the company complied with corporate governance codes, except for quarterly management reporting to the Board - As of June 30, 2023, the Group had 7,086 full-time employees, with total staff costs of RMB 1.865 billion for H1[51] - The Audit Committee has reviewed the Group's unaudited interim financial information for the six months ended June 30, 2023[53] - The company has complied with all applicable provisions of the Corporate Governance Code, except that management provides business updates to the Board quarterly instead of monthly as recommended by the code[55]